A very interesting article from Financial Times columnist David Stevenson suggests that investors are making the very common mistake of missing sight of the forest for the trees.
In this case, the trees are the daily ups and downs of the stock market. Market volatility naturally draws many people into a sort of short-term obsession with undulating asset prices and portfolio values.
Stevenson makes that very valid point that this short-term obsession obscures larger, longer-term and likely slower moving trends that are likely to have a much greater impact on our financial well-being.
The big picture trend that Stevenson discusses is longevity. More specifically, he suggests that longevity risk will have an impact on pension finance that makes market volatility pale in comparison.
There is an interesting info-graphic that accompanies the article. The graphic provides a representation of the UK pension crisis.
Source: Financial Times
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